Weekly Health Care Policy Update – May 23, 2022

In this update: 

• Covid-19 Updates
  • Covid-19 PHE Expected to Be Extended
  • FDA Approves Covid-19 Boosters for Kids Ages 5-11
  • HRSA Extends N95 Mask Program Through June 20^th
• Federal Agencies
  • CMS To Hold May 25^th Call on Medicaid and CHIP Continuous Enrollment Unwinding
  • SAMHSA Announces FY 2022 State Opioid Response Program
  • Treasury Comment Period on $10B Capital Fund Reporting Guidance Ends May 25^th
• Other Updates
  • Judge Throws Out 2020 Rule on Best Prices Calculations for Drugs and Accumulator Adjustment Programs
  • HRSA Publishes Maternity Care Target Area Criteria
  • CBO Says Lowering Medicare Age to 60 Would Increase Deficit by $155 Billion from 2026-2031
  • MACPAC Publishes Issue Brief on Medicaid Funding of SDH Interventions
  • AHIP Launches Healthier People through Healthier Markets Roadmap
  • Study Finds PRF Maintained Hospital Financial Viability During 2020
  • RAND Study Finds Commercial Plans Pay Hospitals 224% of Medicare
• New York State Updates
  • DOH Releases Final Updated 2022 VBP Roadmap
  • CMS Approves New York SPA Expanding List of Eligible Lactation Counseling Service Providers
  • CMS Approves New York SPA Implementing 1% COLA for Day Treatment, Article 16 Clinic, and IPSIDD
  • CMS Approves NHTD and TBI Waiver Amendment Enacting Provisions of eFMAP Spending Plan
  • DOH Releases Updated Children’s HCBS Provider Manual
• Funding Opportunities
  • HHS Funding Opportunity to Support Reducing Maternal Deaths Due to Substance Use Disorder
  • SAMHSA Announces New Behavioral Health Recovery Innovation Challenge
  • SAMHSA Offers $3.5 Million for Center of Excellence on Asian American Behavioral Health
  • SAMHSA Offers $10 Million for Center of Excellence on Social Media and Mental Wellness
  • SAMHSA Offers $15 Million for Center of Excellence on Behavioral Health Care in Nursing Facilities
  • HHS and Cohen Foundation Launch $1 Million LymeX Diagnostics Prize

Covid-19 Updates

Covid-19 PHE Expected to Be Extended
The federal declaration of the Covid-19 Public Health Emergency (PHE) is now expected to continue past July, as the deadline for the Biden Administration’s public commitment to provide 60 days’ notice of its end passed on May 16^th. Currently, the PHE is scheduled to continue through July 16^th. Another 90-day extension from that date would end the PHE on October 13^th. The Secretary of Health and Human Services (HHS) has the authority to declare a PHE for the “duration of the emergency or 90 days,” so a shorter extension is possible. However, because of the proximity to the November elections, an extension through the end of 2022 is currently viewed as more likely.
 
If the PHE were to expire on October 13^th, the Administration would be expected to provide notice by August 14^th. After October 13^th:

• Coverage of Covid-19 testing, vaccines, and (in some cases) certain treatments without cost-sharing in Medicare, Medicaid, and private insurance would end immediately.
• Medicare payment flexibilities, including the 20% increase in payment rates for inpatient stays with a Covid-19 diagnosis, would end immediately.
• Emergency waivers, such as Appendix K and Disaster State Plan Amendments, would expire or begin to phase out based on their individual provisions.
• State Medicaid programs would be required to begin initiating eligibility redeterminations no later than November 1^st.
• The 6.2% enhanced federal Medical Assistance Percentage (FMAP) would expire at the end of the quarter (December 31^st).
• Current Medicare telehealth flexibilities, including the lifting of geographic restrictions, would expire 151 days after the PHE (March 13, 2023).

FDA Approves Covid-19 Boosters for Kids Ages 5-11
On May 17^th, the Food and Drug Administration (FDA) amended the Emergency Use Authorization (EUA) for the Pfizer/BioNTech Covid-19 vaccine, approving a booster dose for children ages 5 through 11 years. The booster is approved for children who completed their primary series of the Pfizer/BioNTech Covid-19 vaccine at least five months ago. In its approval, the FDA noted that vaccine efficacy against Covid-19 wanes after the second dose in all authorized populations, and that the known and potential benefits of a single booster dose outweigh its known and potential risks, providing continued protection against the virus. The FDA approved the Pfizer-BioNTech booster dose for children ages 12 through 15 years on January 3^rd.
 
More information is available here.
 
HRSA Extends N95 Mask Program Through June 20^th
On May 17^th, the Health Resources and Services Administration (HRSA) announced the extension of the HRSA Health Center Covid-19 N95 mask program through Monday, June 20^th. The program began on January 17^th to distribute high-quality N95 masks to underserved communities and populations through health centers. The extension will allow health centers three additional opportunities to order masks before the program sunsets: May 23^rd, June 6^th, and June 20^th. HRSA also increased the ordering cap to support larger orders and allow health centers with available space to order masks to store for upcoming months.
 
More information about the program is available here.

Federal Agencies

CMS To Hold May 25^th Call on Medicaid and CHIP Continuous Enrollment Unwinding
On May 25^th at 12pm, the Centers for Medicare & Medicaid Services (CMS) will hold the first in a monthly partner education series on Medicaid and CHIP Continuous Enrollment Unwinding. The calls are intended to prepare states for the eventual end of flexibilities that prevented beneficiaries with Medicaid and CHIP from losing their health coverage during the pandemic, which will lead to the resumption of Medicaid and CHIP eligibility reviews. As many as 15 million enrollees could lose coverage through this process. The call will cover:

• Background information on the Medicaid continuous enrollment requirements;
• Efforts to connect people to coverage;
• Strategies to engage people with Medicaid and CHIP; and
• Resources available to begin sharing information on preparing for the Medicaid and CHIP redetermination process.

Registration is available here. Questions may be submitted to partnership@cms.hhs.gov.
 
SAMHSA Announces FY 2022 State Opioid Response Program
On May 19^th, HHS, through the Substance Abuse and Mental Health Administration (SAMHSA), announced that it will award up to $1.5 billion to states and territories through the State Opioid Response (SOR) program in FY 2022. States may use this funding for programs to increase access to medication for the treatment of opioid use disorder (OUD) and supporting prevention, harm reduction, treatment, and recovery support services for OUD.
 
New York is eligible to receive about $57 million under the SOR program. In New York, the SOR program is administered by the Office of Addiction Supports and Services (OASAS) through its fiscal agent, the Research Foundation for Mental Hygiene. OASAS is expected to use this funding to support new and existing programs for the treatment of OUD.
 
HHS’s press release is available here.
 
Treasury Comment Period on $10B Capital Fund Reporting Guidance Ends May 25^th 
The two-week comment period on the Department of the Treasury’s draft reporting requirements for the Coronavirus Capital Projects Fund ends May 25^th. This funding, part of the American Rescue Plan (ARP), offers states a total of $10 billion for capital projects “directly enabling work, education, and health monitoring, including remote options,” in response to Covid-19. States may propose a variety of projects for approval. Certain projects, including broadband infrastructure, digital connectivity technology, and multi-purpose community facilities, are presumptively eligible. New York has been allocated about $345 million, and the State has indicated that it is likely to use the funds for the ConnectAll broadband initiative.
 
Under the draft guidance, states will be required to submit quarterly project and expenditure reports starting July 31^st as well as annual performance reports starting with an interim report on January 31, 2023.
 
The draft guidance is available here.

Other Updates

Judge Throws Out 2020 Rule on Best Prices Calculations for Drugs and Accumulator Adjustment Programs
On May 18^th, U.S. District Court Judge Carl Nichols issued a ruling overturning a rule finalized by CMS in December 2020 that would have required drugmakers to ensure that the full value of manufacturer cost-sharing assistance promotions (such as copay coupons or discount cards) must be provided entirely to patients, if such discounts are to be excluded from the calculation of “best prices” under the Medicaid program. Drugmakers must offer State Medicaid programs the “best price” that they offer to other customers to participate in Medicaid.
 
CMS originally issued the rule to address the rising use of “copay accumulator” programs by insurers and pharmacy benefit managers (PBMs). Plans using copay accumulators do not count such cost-sharing assistance as patient cost-sharing for the purposes of calculating payments towards deductibles or maximum out-of-pocket limits. CMS noted in its rule that this meant such discounts were fundamentally benefiting health plans, and drugmakers would therefore have to incorporate such discounts into the “best price” for Medicaid. 
 
Judge Nichols’s ruling relied on the Medicaid statute’s definition of “best price,” which is the price offered to “any eligible purchaser,” including wholesalers, retailers, health care providers, nonprofits, and government entities. The ruling states that patient assistance programs do not affect the definition of “best price,” since that is “a price made available from a manufacturer to a best-price-eligible purchaser,” regardless of whether a copay accumulator applies, and therefore that the 2020 rule went beyond CMS’s regulatory authority.
 
The rule was scheduled to go into effect on January 1, 2023. CMS has not yet indicated whether it will appeal. The ruling is available here. The original final rule is available here.
 
HRSA Publishes Maternity Care Target Area Criteria
On May 18^th, the Health Resources and Services Administration (HRSA) published the final criteria that it will use to identify Maternity Care Target Areas (MCTAs). The final notice summarizes and responds to comments made on the original proposal issued in September 2021. Under the final approach, a MCTA score will be generated for each primary care Health Professional Shortage Area’s geography, based on the following six scoring criteria: 

• Ratio of females ages 15 to 44 to full time equivalent (FTE) maternity health care professional ratio (up to 5 points);
• Percentage of females 15 to 44 with income below 200 percent of the federal poverty line (up to 5 points);
• Travel time and distance to the nearest provider licensed to provide maternity care (up to 5 points);
• Fertility rate (up to 2 points);
• The Social Vulnerability Index (SVI) (up to 2 points); and
• A Maternal Health Index with six factors (1 point available for each factor).

 Like HPSA scores, the resulting scores will range from zero to 25. MCTAs are used to prioritize assignment for the maternity professionals under the National Health Service Corps.
 
The full notice is available here.
 
CBO Says Lowering Medicare Age to 60 Would Increase Deficit by $155 Billion from 2026-2031
On May 16^th, the Congressional Budget Office (CBO) and the staff of the Joint Committee on Taxation published an estimate of the budgetary impacts of lowering the Medicare age of eligibility from 65 to 60. CBO estimated that the policy would increase the federal deficit by $155 billion over the study period from 2026 through 2031, or about $26 billion per year.
 
CBO projects that about 7.3 million more people would be enrolled in Medicare under this policy, but most of these already have other primary coverage (employment-based, Medicaid, or nongroup coverage), resulting in a decrease of the uninsured population by only about 0.4 million. However, spending on health care would decrease on average for those covered by employer insurance.
 
The report is available here.
 
MACPAC Publishes Issue Brief on Medicaid Funding of SDH Interventions
On May 18^th, the Medicaid and CHIP Payment and Access Commission (MACPAC) published an issue brief on how State Medicaid programs may finance approaches to address the social determinants of health (SDH). The MACPAC report describes the various options available under the three primary approaches for Medicaid programs to finance SDH interventions and discusses some of the statutory and regulatory limits to these uses of funds. Specifically: 

• Medicaid programs may cover certain SDH services directly under the State Plan, such as: case management and Health Homes; the optional rehabilitative services state plan benefit; and Section 1915(i) home and community-based services (HCBS).
• States may require managed care plans to provide SDH services, such as: value-added services, such as wellness incentives; approved in-lieu-of services that are cost-effective substitutes for other medical services; value-based purchasing (VBP) requirements; and direct adjustments to capitation rates for SDH factors.
• States may pursue one-time grants or waivers, including 1115 demonstrations and 1915(c) HCBS waivers.

The issue brief is available here.
 
AHIP Launches Healthier People through Healthier Markets Roadmap 
On May 17^th, America’s Health Insurance Plans (AHIP) launched its “Healthier People through Healthier Markets” policy roadmap, an effort to “boost competition in health care markets.” As part of the effort, AHIP sent letters to President Biden and congressional leadership laying out a set of legislative and regulatory actions that the organization argues will increase competition, drive down costs, and improve access. The letters call for:

• Expanded access to telehealth, home-based care, and biosimilar drugs;
• Increased transparency into private equity control of health care entities and its effect on prices;
• Additional use of site-neutral payments;
• Antitrust and other actions to address the “dialysis duopoly” (DaVita and Fresenius);
• Prohibition of the use of “all-or-nothing” or “anti-tiering” contract terms by health systems;
• Actions to reduce drug manufacturers’ use of patient assistance charities and approaches such as copay coupons;
• Actions to address drug manufacturers’ use of patents to maintain profits; and
• Reforms to the system for provider-acquired drugs.

The letter to President Biden is available here. The letter to congressional leadership is availablhere. An issue brief is available here.
 
Study Finds PRF Maintained Hospital Financial Viability During 2020
On May 13^th, research published in the JAMA Health Forum detailed the effect of operational disruptions and Covid-19 relief funds on the financial viability of hospitals across the United States during the pandemic. The study examined 2,163 hospitals across the country and examined annual operating margins, overall profit margins, and other nonoperating income as a share of total revenue from January 2016 to December 2020. While researchers observed significant reductions in operating margins in 2020 (from -1.0% in 2019 to -7.4% in 2020), overall profit margins remained similar to those in prior years given the offset of Covid-19 Provider Relief Fund dollars. Government, rural, and smaller hospitals experienced higher mean overall profit margins in 2020 compared to 2019. The researchers conclude that Covid-19 relief fund dollars effectively offset the financial losses for hospitals during the Covid-19 pandemic during the study period.
 
The full article is available here.
 
RAND Study Finds Commercial Plans Pay Hospitals 224% of Medicare 
On May 17^th, the RAND Corporation published a new report showing that employers and private plans paid hospitals 224% of Medicare for both inpatient and outpatient services in 2020. This is a slight reduction from the 247% difference reported in 2018, which researchers largely attribute to the inclusion of new data from Washington, Oregon, and Utah, where hospitals tend to have lower prices. The rate discrepancy held across all inpatient and outpatient services. The inpatient relative payment for COVID-19 hospitalizations was 241% of Medicare rates. However, the difference in relative prices varied by state. Some states (Hawaii, Arkansas, and Washington) had relative prices below 175% of Medicare prices, while other states (Florida, West Virginia, South Carolina) had relative prices that were 310% of Medicare prices or more. In New York, employers and private plans paid hospitals 263% of what Medicare paid for the same services. 
 
The report is available here.

New York State Updates

DOH Releases Final Updated 2022 VBP Roadmap
On May 13^th, the New York State Department of Health (DOH) released a final updated Value-Based Payment (VBP) Roadmap following a review of public comments. The draft Roadmap, which did not contain any material changes to the requirements of the program, was released for public comment in January 2022 with the intent of clarifying provider and managed care organization (MCO) expectations, reiterating DOH’s ongoing commitment to VBP, and seeking stakeholder input and ideas for future Roadmap iterations.
 
DOH noted that it would not address some requests received during public comment because they would require material changes to the Roadmap or formal approval, such as through an 1115 waiver. However, it did address requests to provide further clarity on current VBP requirements and guidelines in this final version of the Roadmap. Changes to the Roadmap include:
 
Financial Mechanisms

• Providers and plans may consider other factors, such as regional benchmarks, in addition to historical cost when calculating the target budget for a VBP arrangement.
• As in the original Roadmap, in a Level 1 VBP Arrangement, at least 40% of savings must be allocated to the VBP contractor if they meet minimum quality goals (not “all” quality goals).

SDH Requirements for Level 2 and Level 3 Arrangements

• In addition to individual CBOs, a “CBO network composed of not-for-profit organizations” may meet the requirement for a Level 2 or Level 3 VBP contract to include at least one community-based organization (CBO) in the arrangement.
• MCOs must demonstrate and report on the utilization and evaluation of SDH interventions and CBO contracts to the State.
• The Roadmap’s requirement that Level 2 or Level 3 contracts must include start-up funds or seed money for CBOs has been broadened to require that details on the process for distributing these funds must be included in the CBO’s contract, and usage of funds should be reported through the SDH Intervention Status Report.
• The first version of this revised Roadmap removed the CBO tiers of the original Roadmap, which stated that a non-Medicaid billing (Tier 1) CBO must be involved in a Level 2 or Level 3 arrangement. However, DOH is now clarifying that the SDH intervention included in such an arrangement still may not be a Medicaid-billable service.
• As in the original Roadmap, the new MCOs may collaborate with third-party partners to identify and secure investment and support for social care needs interventions, consistent with applicable law.

Additional information, including the final Roadmap and executive summary, summary of the public comments, and VBP checklists for MCOs may be accessed here under “VBP Roadmap.” Questions may be submitted to VBP@health.ny.gov.
 
CMS Approves New York SPA Expanding List of Eligible Lactation Counseling Service Providers
On May 12^th, CMS approved New York’s proposal for a State Plan Amendment (SPA) to expand the list of eligible practitioners who may provide lactation counseling services for pregnant and postpartum individuals. As a result, the following practitioners are qualified to deliver Medicaid-reimbursable lactation counseling services if they have certification as a lactation care provider from an accredited program: 

• Licensed physicians;
• Physician assistants;
• Pediatric or family nurse practitioners;
• Nurse-midwives; and
• Registered nurses.

The SPA is available here. The CMS approval letter is available here.
 
CMS Approves New York SPA Implementing 1% COLA for Day Treatment, Article 16 Clinic, and IPSIDD
On May 11^th, CMS approved New York’s proposal for a SPA implementing a one-percent cost of living adjustment (COLA) for certain non-institutional services as per the Enacted Fiscal Year 2022 Budget. The amendment applies to the following services, effective July 1, 2021: 

• Day treatment;
• Article 16 clinic services; and
• Independent Practitioner Services for Individuals with Developmental Disabilities (IPSIDD)

The SPA is available here. The CMS approval letter is available here.
 
CMS Approves NHTD and TBI Waiver Amendment Enacting Provisions of eFMAP Spending Plan
On May 13^th, CMS approved the Nursing Home Transition and Diversion (NHTD) and Traumatic Brain Injury (TBI) Appendix K Waiver Amendment. The Amendment enacts the following provisions of the State’s spending plan for the enhanced HCBS under the American Rescue Plan Act: 

• Provides a one-time performance payment for each direct service staff person;
• Implements a statewide training stipend program to reimburse providers for a portion of costs incurred above and beyond typical expenses for staff training due to increased staff turnover;
• Provides an additional stipend for staff who are fully vaccinated; and
• Enhances current rates for Structured Day Programs and Home and Community Support Services (HCSS) Nursing Visits.

The Amendment also makes several revisions to the Waiver, including but not limited to: 

• Advising providers that claims may be submitted using quarter-hour units for certain services;
• Modifying the NHTD Nursing Visit rate from a per visit rate to an hourly rate;
• Adding a rate differential to the existing hourly rate for Structured Day Programs effective April 1, 2021;
• Requiring the resumption of face-to-face nursing supervision services for HCSS;
• Terminating access to retainer payments; and
• Requiring service coordination providers to submit a transition plan in anticipation of the termination of the federal PHE.

The Amendment is available here. The Amendment is effective through six months after the end of the federal PHE for Covid-19.
 
DOH Releases Updated Children’s HCBS Provider Manual
On May 17^th, DOH released an updated Children’s Home and Community Based Services (HCBS) provider manual. Changes include, but are not limited to: 

• Removal of reference to Level of Need (LON) criteria, which was a proposed expansion on Level of Care (LOC) criteria to address gaps in service for children/youth who may benefit from HCBS but do not meet the LOC criteria;
• New sections on provider requirements and provider attestation, including outlining a requirement that provider designation be renewed at least every three years;
• Clarifications on requirements for face-to-face meetings;
• Inclusion of performance measures pertinent to HCBS providers; and
• Clarifications on eligibility criteria and determinations.

The updated provider manual is available here and a guide to the updates is available here. Questions may be submitted to BH.Transition@health.ny.gov.  

Funding Opportunities

HHS Funding Opportunity to Support Reducing Maternal Deaths Due to Substance Use Disorder
On May 5^th, the HHS Office on Women’s Health released a funding opportunity for projects designed to: 

• Strengthen perinatal and postnatal support structures for patients with substance use disorder; and
• Reduce deaths during the perinatal and postpartum period.

Applicants will be expected to partner with hospital and community-based organizations to implement evidence-based interventions and create technologically innovative education and outreach products to support patients remotely. Eligible applicants are public or private entities, which may be for-profit or not-for-profit. HHS will award five entities with grants up to $300,000 annually. Projects will last for up to three years, with an optional competitive fourth year to support participants with transitioning to sustainability.
 
Additional information is available here. Applications are due on July 11^th.  
 
SAMHSA Announces New Behavioral Health Recovery Innovation Challenge
On May 18^th, SAMHSA announced the launch of a new Behavioral Health Recovery Innovation Challenge. This opportunity seeks innovations from peer-run or community-based organizations and their partners (i.e., hospitals, treatment centers, health plans, state or local government) that advance recovery within the mental health, substance use, and co-occurring domains.
 
In particular, SAMHSA aims to learn from applicant organizations: 

• What challenges have you experienced in advancing recovery?
• How are you advancing recovery/what innovations have you developed to advance recovery?
• How do you know your efforts are working and how do you measure success?

SAMHSA will provide up to $400,000 in prize money across up to 10 awardees. Applicants will be expected to describe their recovery innovation and its impact via a written narrative (five pages or less). 
 
The SAMHSA press release is available here and additional information is available here. Applications are due on July 15^th. Finalists will be announced on August 6^th and will be expected to present to a panel of judges from September 2^nd-9^th. Awards will be announced in October 2022.
 
SAMHSA Offers $3.5 Million for Center of Excellence on Asian American Behavioral Health
On May 17^th, HHS, through SAMHSA, announced a funding opportunity for $3.5 million over five years to establish a national Asian American, Native Hawaiian, and Pacific Islander Behavioral Health Center of Excellence. This Center of Excellence will promote culturally appropriate behavioral health information and practices and offer technical assistance to practitioners and community organizations. Eligible applicants may include domestic public or private not-for-profit entities.
 
HHS’s press release is available here. The Notice of Funding Opportunity is available here.Applications are due July 8^th.
 
SAMHSA Offers $10 Million for Center of Excellence on Social Media and Mental Wellness
On May 18^th, HHS, through SAMHSA, announced a funding opportunity for up to $10 million over five years to establish a national Social Media and Mental Wellness Center of Excellence. This Center of Excellence will focus on three priorities: 

• Education and resources around the risks and benefits of social media use for children and youth;
• Culturally and linguistically appropriate technical assistance for providers who work with youth to help them interact positively with the digital world; and
•  Best practices and research updates.

Eligible applicants may include domestic public or private nonprofit entities as well as community and faith-based organizations.
 
HHS’s press release is available here. The Notice of Funding Opportunity is available here. Applications are due July 18^th.
 
SAMHSA Offers $15 Million for Center of Excellence on Behavioral Health Care in Nursing Facilities
On May 16^th, HHS, through SAMHSA, issued a press release on a funding opportunity released in April for up to $15 million over three years to establish a national Center of Excellence for Building Capacity in Nursing Facilities to Care for Residents with Behavioral Health Conditions. This Center of Excellence will promote effective resident care through direct consultation to nursing home staff to help them increase awareness and build knowledge and skills related to behavioral health needs. It will also ensure that evidence-based training and technical assistance is available to support nursing facilities in addressing  the need for mental health disorder identification, training, and recovery support services.
 
HHS’s press release is available here. The Notice of Funding Opportunity is available here. Applications are due June 20^th.
 
HHS and Cohen Foundation Launch $1 Million LymeX Diagnostics Prize
On May 17^th, HHS, in partnership with the Steven and Alexandra Cohen Foundation, announced the launch of Phase 1 of the LymeX diagnostics prize competition. In Phase 1, LymeX will offer a total of $1 million to up to 10 entrants who submit concept papers detailing scientifically rigorous proposals to improve early detection of Lyme disease, including roadmaps for developing and evaluating prototypes. If Phase 2 moves forward, the winners of Phase 1 will be eligible for further funding to prototype and refine their solutions. At the discretion of HHS and the Cohen Foundation, at least one more phase may follow Phase 2.
 
More information is available on the LymeX site here. Papers are due August 8^th.